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1 year ago

The Asset Value of Whiteness

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Working full time does

Working full time does not close the racial wealth gap. Full-time work is critical to the economic security of most American households. Full-time jobs generally pay more per hour than comparable part-time work and are more likely to offer benefits such as employer-provided health coverage, paid sick time, and workplace retirement plans that can provide greater opportunities for employees to build wealth. At the median, households in which at least 1 member works full time (35 or more hours per week) have greater wealth than households where the only jobs held are part-time positions (less than 35 hours per week). But working full time isn’t enough to close the racial wealth gap. According to data from the Survey of Consumer Finances, the median white household that includes a full-time worker has 7.6 times more wealth than the median black household with a full-time worker. The median white household that includes a full-time worker also has 5.4 times more wealth than the median Latino household with a full-time worker. Even white households that include only part-time workers—with at least 1 person in the household employed but not working more than 35 hours a week—have statistically indistinguishable levels of wealth as black households with a member employed full-time. 18 The median white household that includes a full-time worker has 7.6 times more wealth than the median black household with a full-time worker. The median white household that includes a full-time worker also has 5.4 times more wealth than the median Latino household with a full-time worker. As Figure 3 shows, black households with at least 1 worker employed full time had $10,800 in wealth at the median, while Latino households with at least 1 worker employed full time had $15,300 in wealth at the median. For both groups, this is significantly more than the wealth of households where workers held only part-time jobs. Yet it is nowhere near the $82,400 in median wealth held by white households with a full-time worker. Working full time is far from enough for households of color to catch up to white wealth. Despite all the wealth-building benefits of full-time employment, 9 • demos.org & iasp.brandeis.edu

median black and Latino households with full-time workers had essentially the same level of wealth as the median white household with only part-time employment. Figure 3. Median Wealth of Full- and Part-Time Workers, for Working Households under Age 55 $90,000 $80,000 $82,400 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $15,300 $10,800 $9,200 $2,500 $4,600 $0 White Black Latino* White Black Part-Time Work Latino* Full-Time Work Source: authors' calculations of the Survey of Consumer Finances, 2013 * Latino refers to anyone who identified as Hispanic or Latino on the Survey of Consumer Finances and may be of any race. Americans of all races and ethnicities work hard: among working white, black, and Latino households with a head under age 55, all work at least 40 hours a week at the median and 80 percent or more have an adult employed full-time. 19 Yet work effort does not pay off equally: in 2012, white workers employed full time earned a median wage of $792 a week, compared to $621 for African Americans and $568 for Latinos. Considering gender makes the pay disparities even more glaring: Latina women employed full time earned median weekly wages equal to just 59 percent of the wages earned by white males, while black women earned just 68 percent as much. 20 However, even if households earned the same income, the racial wealth gap would persist. Previous research from Demos and Institute on Assets and Social Policy at Brandeis University finds that if the distribution of incomes for black and Latino Americans was similar to that of white households (with a median equal to $50,400 in 2011), the wealth gap between black and white households would shrink just 11 percent at the median and the wealth gap between Latino and white households would shrink just 9 percent. An individual’s striving to get a higher paid job or work more hours is not enough to close the racial wealth gap. 2017 • 10

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